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on Payment Systems and Financial Technology |
| By: | Munyengera, Ggombe Kasim; Agnes, Mutuyimana; Seth, Kwizera; Precious, Akampumuza |
| Abstract: | Digital financial inclusion in Rwanda has grown from 46% of adults in 2016 to 66% in 2020. The nature of payments has also evolved, shifting from peer-to-peer transactions to more sophisticated ones, such as tax payments. According to the 2020 Finscope survey, 94% of commercial banks now offer some form of electronic payment. This progress notwithstanding, cash remains the preferred method of payment for groceries (98% of respondents), electricity (52%), medical fees (60%), education (44%), and personal spending (60%). Critical impediments to further DFS development and adoption include limited interoperability among platforms and services of different service providers and low levels of digital literacy. The mid-term evaluation of the National Strategy for Transformation revealed that only 24% of adults were digitally literate in 2021, less than halfway to the target of 60% by 2024. Low levels of awareness of DFS products, unreliable networks, especially in rural areas, and low levels of trust partially motivated by cyber insecurity are additional impediments to being addressed. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:b37c4ced-2a36-4e7e-8c3c-2ed0552a17ce |
| By: | Munyegera, Ggombe Kasim |
| Abstract: | Persons with disabilities have disproportionately lower levels of access to financial and other services globally, resulting in lower socio-economic status relative to the general population. This study uses a mixed methods approach to quantify and explain the disability divide in Rwandas financial services. Using Probit models, the probabilities of accessing, owning and using digital platforms, financial accounts and products, and financial services are estimated while Tobit models are used to estimate the value of financial transactions. Probit and Tobit estimates are complemented by propensity score matching (PSM) as a robustness check. The results indicate that persons with disabilities are significantly less likely to own a mobile phone, computer and Internet or even use those owned by someone else. Ownership rates of mobile money and bank accounts, automated teller machine (ATM), credit cards, and usage of mobile and Internet banking are also lower among persons with disabilities. The usage of financial services saving, remittances, credit and insurance is also lower among persons with disabilities at the extensive margin (probability of usage) and intensive margin (value of transactions). A further finding is that, conditional on having a disability, females are less financially included related to males. The findings carry key implications regarding the need to boost financial inclusion for persons with disabilities to achieve overall equality as stipulated in Sustainable Development Goal (SDG) 10. Among others, there is need for interventions to raise digital and financial literacy among persons with disabilities and develop innovative products that appeal to the financial needs and difficulties of this vulnerable group in general and women with disabilities in particular. |
| Date: | 2024–08–15 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:7dfeab2a-be4d-4ca7-8cc3-48bf0a249fe8 |
| By: | Osoro, Jared; Bundi, Davis; Kiplangat, Josea |
| Abstract: | The noticeable strides Kenya has made on digital financial services that anchor the positive narrative of financial inclusion is evidently leaning towards payment services. However, digital divide still exists due to behavioural heterogeneity. This paper explores the influence of behavioural biases in access and usage of mobile money services, the dominant digital financial services in Kenya. The 2021 FinAccess data anchors the empirical investigation on the extent to which behavioural biases are an obstacle to access and usage of mobile money. Deploying descriptive statistics on gender disaggregated data and a probit model to estimate marginal effects, we ascertain that behavioural biases contribute to the digital divide evident among men and women households in Kenya. These biases drive a wedge between access and enhanced usage of digital financial services in a manner that slows the sequential process of the former, leading to the latter. Beyond advancing literature in this area, this paper proffers arguments in favour of putting in place measures to enhance household incomes that have a gender lens, for they have the potential of ameliorating the gaps underlying financial exclusion of women and low-income earners in mobile money access and usage. It also argues for a policy position that discourages the consideration of basic digital financial services as a revenue mobilization platform through direct taxation as that could be counterintuitive. |
| Date: | 2024–08–15 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:0cdc9b6d-5d8c-46e6-8f00-e9039cb8238b |
| By: | Munyegera, Ggombe Kasim |
| Abstract: | Digital financial services (DFS) have the potential to promote payments efficiency and boost financial inclusion even in remote areas with minimal traditional financial infrastructure such as bank branches. In Rwanda, the digitization of payments is a key policy strategy in a bid to transform the country towards a more cashless and knowledge-based economy. Since the establishment of the Rwanda Integrated Payments Processing System (RIPPS), various policy and product innovations have been put in place to increase the share of transactions done electronically. This study examines the development path of digital financial services in Rwanda over the decade 2011-2021 using a mixed-methods approach. The quantitative part entails descriptive and regression analysis to ascertain the trend, patterns and determinants of uptake for key DFS products in the country while the qualitative key informant interviews with key stakeholders are used to ascertain the opportunities and challenges for further promoting DFS in the country. The findings indicate that between 2011 and 2021, the number of people using Internet and mobile banking increased quite substantially. The number of active mobile money subscribers increased from 1.6 million in 2012 to 5.1 million in 2021, while credit cards increased from 115, 200 in 2011 to 686, 309 in 2021. The transactional volume and value also increased remarkably, partly fueled by COVID-19 and innovative use of mobile money, including electronic tax payment. The study recommends improving Internet connectivity and quality, promoting digital literacy, improving interoperability and enhancing cyber security to further boost DFS in Rwanda. |
| Date: | 2024–08–15 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:319299ff-f4f7-4716-a582-12b056c2bb85 |
| By: | Kodongo, Odongo |
| Abstract: | The purpose of this policy brief is to explain the role that the fintech (financial technology) ecosystem could play in facilitating financial inclusion in Kenya. The country has witnessed tremendous growth in the fintech subsector in recent years. It had at least 385 registered fintech firms/startups by July 2022 operating in various subspaces such as savings and credit, foreign exchange and cryptocurrency, insurance, and micro/neo-banking. Alongside these developments there has been a steep growth in financial inclusion, with FinAccess surveys documenting growth in formal financial services usage between 2006 and 2021 from 33.2% to 85.9% among men, and from 20.5% to 81.7% among women. Therefore, understanding the linkages between fintech and usage of formal financial services is of interest to policymakers. This study explored linkages using FinAccess data for 2016 and 2021 and documented several interesting findings. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:1503a2fb-6c52-479f-bdb0-4dee7501bd9b |
| By: | Nicholas, Okot; Elizabeth, Kasekende |
| Abstract: | Financial inclusion is crucial for sustained growth and development. However, it relies on an appropriate policy environment to ensure confidence. Digital Finance Services (DFS) are believed to enhance financial inclusion by promoting efficient access for the vulnerable. With a mobile money penetration rate of 51%, Ugandans are poised to benefit from digital financial innovations. The other DFS channels are internet banking, financial cards, e-commerce, and integrated payment platforms. In the last decade, Uganda has made significant strides to promote access, uptake, and usage of DFS to reach the unbanked share of the population. The goal of the National Financial Inclusion Strategy is to achieve 75% formal inclusion by 2028. This milestone seems ambitious, given Ugandas financial infrastructure and social structure. This could be achieved if the country maintains the current trajectory of DFS adoption supported by an adequate policy and institutional framework aligned with global best practices to engender equity across the social divide. Do these policies lead to higher levels of financial inclusion? |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:beef6cab-ed85-46d8-9cdb-3e6f2d12eb29 |
| By: | Daniel, Lanta |
| Abstract: | Financial inclusion, particularly through mobile money services, plays a vital role in fostering economic growth in developing economies by providing access to financial products and services. In Tanzania, where 88% of the population owns mobile phones, approximately 45% possess mobile money accounts. Nevertheless, there remains a notable disparity concerning gender (men and women) and geographical location (rural and Urban), with women in rural areas being more prone to exclusion. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:8259219b-f0af-4e41-93aa-40cc2bd14d60 |
| By: | Wamalwa, Peter; Tiriongo, Samuel; Mulindi, Hillary |
| Abstract: | Competition in the banking sector is a catalyst for innovation and the adoption of digital channels to provide financial services. The low cost of providing financial services through digital channels has been leveraged on by banks to extend services to the underserved and the excluded. This paper deploys panel regressions and binary response models to analyse the impact of competition in the banking sector on penetration and utilization of digital financial services across gender in Kenya, Uganda, and Tanzania, controlling for competition in the telecommunications sector. The latest wave of Finscope Survey (2017) and financial inclusion household survey (FinAccess, 2021) datasets are used. The analysis shows that males have a higher probability of using digital financial services than females. Females in rural areas, engaged in the agriculture, services, trade and casual labour are less likely to use digital financial services compared to their male counterparts. Competition in the banking industry increases utilization of digital financial services due to banks leveraging on innovation to provide relevant services at low cost. Therefore, a policy approach that considers gender differences and fosters competition in banking and mobile telecommunication industries will encourage providers of financial services providers to effectively leverage on mobile money and digital finance to close gender gaps in the utilization of digital financial services in the EAC region. |
| Date: | 2024–08–15 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:ee1ed634-f735-4382-8f2a-4c28005350ec |
| By: | Botha, Rosemary; Kamninga, Tony; Tuyisenge, Methode |
| Abstract: | It is widely known that financial inclusion is key in achieving development at macro and micro level. Rwanda has over the years made great strides in financial inclusion with 93% of the adult population being financially included. Mobile money is the biggest driver of financial inclusion in Rwanda with the uptake among women being relatively lower (84%) compared to men (90%). The fifth Sustainable Development Goal identifies the achievement of gender equality and women empowerment as one important pillar in the achievement of sustainable development. With the high coverage of digital financial inclusion through mobile money and its current structure in the country, it is unknown whether agency is improved for women with access to mobile money. Digital technology has gained prominence to support women empowerment by changing the way business is done and creating better employment opportunities. The current operation of mobile money provides a reliable platform for transactions, but more reforms could be done to provide even better benefits to its clients. This brief discusses results investigating the effect of mobile money access on women empowerment in Rwanda. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:df2934bb-b4e4-43cb-b555-a476fe2aab43 |
| By: | Shinyekwa, Isaac, M.B.; Mpuuga, Dablin; Nattabi, Aida K.; Bulime, Enock W.N. |
| Abstract: | The paper examines the extent to which digital financial services mobile money, online banking and agency banking contribute to financial inclusion in Uganda. We identify the key enablers and inhibitors of access and usage of digital financial services. To achieve this, we adopt a mixed methods approach and use the recent 2019/20 Uganda National Household Survey (UNHS) data, the World Banks Global Findex data for 2021, and insights from key informant interviews. We use an instrumental variable approach to control for endogeneity and run recursive probit models for the binary outcomes of usage of mobile money services, agency banking, and commercial banks. We also run models for access to commercial banks and usage of informal groups. The results re-affirm the gap between men and women in access to and usage of digital and formal financial services, although this gap has significantly reduced over time. We also find that informal financial groups are used more by women. Financial literacy proxied by an individuals ability to read and/or write is a significant enabler of digital financial services usage among both men and women. Conversely, saving money at home/secret place has a strong negative effect on the overall usage of digital financial services, but a strong positive effect on the usage of informal groups. The new financial inclusion strategy should provide incentives to the private sector to promote innovation and investment in a broad range of new, friendly, and affordable products to attract the excluded sections of the population. Importantly, cultural and community institutions provide better opportunity towards changing social norms that have for long disadvantaged women and kept them financially excluded |
| Date: | 2024–08–15 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:4de4e4dd-3a1b-4e3f-b54c-512739576595 |
| By: | Munyegera, Ggombe Kasim |
| Abstract: | Rwanda has achieved remarkable progress in financial inclusion and the development of digital financial services. Women are, however, disproportionately less included in formal financial services. While the overall gender gap in financial inclusion narrowed from four percentage points in 2016 to one percentage point in 2020, women have lower access to formal financial services, including ownership of bank and mobile money accounts. The DFS inclusion rate increased from 46% of the adult population in 2016 to 66% in 2020. However, there is a clear gender gap, with women having a lower DFS inclusion rate (62%) relative to their male counterparts (71%). Evidence-based measures to close the gender gaps in financial inclusion and DFS require research to understand their underlying drivers from the demand and supply sides of the financial sector. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:ebb7b36e-1f52-4577-ae92-704b54bec535 |
| By: | Ogwang, Ambrose; Kahunde, Rehema; Makika, Maya Dennis |
| Abstract: | Using Digital Financial Services (DFS) is key to increasing income-generating capacity, managing risks, lowering transaction costs, accessing credit, and increasing savings. However, women are less likely to be active users of mobile money (25% of women compared to 38% of men), have an account with a financial institution. Similarly, only 44 percent of females used mobile money services in 2019/20 relative to 60 percent of the males in Uganda. This implies significant challenges to overcome in ensuring inclusivity in the transformation to a digital society. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:1dcacb20-d595-46e4-a107-5809dac1dbd1 |
| By: | Daniel, Lanta; Mwighusa, Dennis; Diyamett, Bitrina |
| Abstract: | Financial services are key to economic growth and societal well-being, boosting access to credit, savings, and overall development. Despite progress in mobile phone and mobile money adoption in Sub- Saharan Africa particularly Tanzania, financial exclusion in the country remains high compared to other East African countries, with significant gender and urban-rural disparities. This study examines digital financial inclusion in Tanzania, focusing on rural women's experiences and challenges. Using focus group discussions and policy analysis, the study highlights major gaps in awareness, usage, and understanding of mobile money services, as well as overlooked policy aspects. Key findings reveal that while awareness of digital financial services is widespread, rural communitiesespecially womenlack a thorough understanding of these services. This gap in comprehension limits their usage, indicating that mere awareness is insufficient. The study underscores the importance of tailored interventions, such as community engagement, capacity building for agents, and targeted policy frameworks, to address these challenges. Recommendations are provided for both the public sector and the private sector on how to enhance financial inclusion, ensuring that no one is left behind in the digital financial landscape. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:39cdb42d-dbf4-4e35-a1a7-69a3625e8b0c |
| By: | Bizoza, Saidi; Irakoze, Gildas |
| Abstract: | The effectiveness of financial inclusion as an instrument to address income inequalities and social inclusion is no longer questionable, given its contribution to the SDGs agenda (SDGs 1, 2, 3, 9, and 10). However, in Burundi, financial inclusion remains low with major causes being social exclusion and physical distance. Half of the adult population lives more than 8 km from the nearest financial institution, and 44% need more than 60 minutes to get there. Financial services are concentrated in Bujumbura, with 37.5% of bank branches located there, exacerbating accessibility challenges for those in rural areas. Moreover, only 30% of the total banks and microfinance accounts are held by women. The latter disparities have obvious negative consequences in terms of household welfare. Many efforts to address the issue of financial inclusion failed as they relied on classical banking approaches, themselves depending on costly and unaffordable infrastructure in the context of Burundi. Mobile money (MM) has demonstrated significant potential in advancing financial inclusion, particularly in underserved areas such as rural communities and low-income households. Globally, it is celebrated as a transformative tool for bridging the financial inclusion gap and addressing disparities, including the gender gap. However, in Burundi, the adoption and impact of mobile money remain relatively underexplored. This necessitates a critical assessment to identify effective strategies tailored to Burundi's unique context. Drawing direct inferences from other countries without localized evaluation risks policy misalignment and potential failure. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:aaa4d8cf-2b7d-4962-a91b-b3785ed07b86 |
| By: | Munyengera, Ggombe Kasim; Precious, Akampumuza; Seth, Kwizera |
| Abstract: | As financial inclusion rates rise to cover 93% of the adult population in Rwanda, one in four adults with disabilities has no access to either formal or informal financial services. People with disabilities have lower rates of mobile money account ownership (46%) compared to those without disabilities (59%). Overall rates of bank service usage, including accounts owned by others, were 30% among persons with disabilities and 37% among those without disabilities. Informal services are an inevitable option for people with disabilities whose usage rate is higher (17.9%) than among the rest of the population (14.9%), with substantial cost implications, especially regarding credit. Supply-side constraints include the physical inaccessibility of most financial institution and mobile network operator (MNO) premises, a lack of products tailored to the special needs of persons with disabilities (PWDs), disability-insensitive service delivery channels, and negative stereotypes and discrimination among some financial service providers. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:188fd537-66da-4037-9a2d-4177a704b14d |
| By: | Okelo, Jimmy Apaa |
| Abstract: | Remittances are a major source of financing for many low-income countries. High costs, however, have held back remittance inflows. Estimates show that between 5% and 15% of remittances are lost due to the high costs. Mobile Money has emerged as a powerful tool for cross-border money transfers. Since it was launched in Uganda in 2012, cross-border transfers through mobile money increased tremendously. Inward remittances rose to US$ 45.5 million in December 2021, up from just US$ 6.5 million in 2013. Among the available Mobile Money products (deposits, withdrawals, person-to-person (p2p), person-to-business (p2b), airtime and data purchase), inward and outward remittances grew fastest in 2016-2022 with annual growth rates of 96.4% and 158.3%. The increased use of Mobile Money is a reprieve to lower costs. Data from the World Bank shows that mobile money operators charge the lowest costs. In addition to enhancing competition, convenience, and security, mobile money also serves as a price discovery platform, enabling customers to initiate transactions directly from their handsets without the need to visit operators' outlets. This allows users to transact when exchange rates are favorable. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:a7ec19e9-03e8-466f-bf91-8674bd0d2e02 |
| By: | Garang, James Alic |
| Abstract: | This paper examines the constraints both to the evolution of mobile money and the broader banking sector provision of financial services in South Sudan, focusing on the conflict and state of financial inclusion during the 2011-2021 period. While mobile money has gained momentum in the region and beyond, its introduction in the South Sudanese market is recent, and adoption has been much slower, and differentiated, with customers more likely to have a mobile money account if they are better educated, live in the city, are male, and wealthy. A key contributor is the rudimentary level of South Sudans financial sector development, which feeds into financial exclusion, and the impact of preceding conflicts. Broadly, the paper confirms the longstanding view that economic disruption associated with the civil war and lack of supportive infrastructure are central barriers to expansion of financial services across the country. In conclusion, sustained stability and improved general infrastructure could enhance expansion of financial services and broader inclusion in South Sudan. |
| Date: | 2025–02–07 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:cb78f530-2e9e-4afd-be28-513187bcc244 |
| By: | Manuel Naviglio; Francesco Tarantelli; Fabrizio Lillo |
| Abstract: | Blockchain technology has revolutionized financial markets by enabling decentralized exchanges (DEXs) that operate without intermediaries. Uniswap V2, a leading DEX, facilitates the rapid creation and trading of new tokens, offering high return potential but exposing investors to significant risks. In this work, we analyze the financial impact of newly created tokens, assessing their market dynamics, profitability and liquidity manipulations. Our findings reveal that a significant portion of market liquidity is trapped in honeypots, reducing market efficiency and misleading investors. Applying a simple buy-and-hold strategy, we are able to uncover some major risks associated with investing in newly created tokens, including the widespread presence of rug pulls and sandwich attacks. We extract the optimal sandwich amount, revealing that their proliferation in new tokens stems from higher profitability in low-liquidity pools. Furthermore, we analyze the fundamental differences between token price evolution in swap time and physical time. Using clustering techniques, we highlight these differences and identify typical patterns of honeypot and sellable tokens. Our study provides insights into the risks and financial dynamics of decentralized markets and their challenges for investors. |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2502.10512 |
| By: | David Lee Kuo Chuen; Yang Li |
| Abstract: | Blockchain technology, though conceptualized in the early 1990s, only gained practical relevance with Bitcoin's launch in 2009. Recent advancements have demonstrated its transformative potential, particularly in the digital art and global payment sectors. Non-fungible tokens (NFTs) have redefined digital ownership, while financial institutions use blockchain to enhance cross-border transactions, reducing costs and settlement times. Using the Diamond-Mortensen-Pissarides (DMP) model, this paper examines blockchain's impact on labor markets by improving job-matching efficiency, thereby reducing unemployment. However, high research costs and competition with incumbent technologies hinder early-stage blockchain adoption. We extend the DMP model to analyze the role of government intervention through tax and wage policies in mitigating these barriers. Our findings suggest that lowering firm tax rates can accelerate blockchain innovation, enhance labor market efficiency, and promote employment growth, highlighting the critical balance between technological progress and economic policy in fostering blockchain-driven economic transformation. |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2502.15549 |
| By: | Ndayikeza, Michel Armel; Nyamweru, Jean Claude; Ndoricimpa, Arcade |
| Abstract: | This study examines the use of mobile money services in Burundi and compares it with other East African countries to identify areas for improvement. The focus is on the supply side, with the aim of offering practical recommendations for policy makers to enhance the usage of mobile money. We use secondary data to compare mobile money usage and transaction fees across East African Community (EAC) countries. Additionally, the analysis draws on semi-structured interviews with key informants from the National Agency of Regulation and Control of Telecommunications, the Central Bank of Burundi, the Ministry of Finance, and other institutions crucial to the development of mobile money. The information collected during these interviews is organized into four thematic areas: institutional environment and regulation, interoperability, government's role, and the impact on smallholder farmers. The findings indicate that mobile money usage in Burundi is relatively low, standing at 11%, in comparison to other EAC countries. Although higher than South Sudan's usage rate of 1%, it falls far behind Tanzania (45%), Uganda (54%), and Kenya (69%). The cost of sending US$ 10 varies between 0.2% and 10.8% across EAC countries, with the lowest fees observed in Kenya and the highest in Tanzania. Interviews with experts highlighted the need for supply-side actors to recognize the country's low mobile money usage rate and fully realize the potential benefits of this technology. The study contributes to the limited literature on mobile money and digital finance in Burundi and offers some policy recommendations to address the issue. |
| Date: | 2024–08–15 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:ff95cc46-5259-4cf8-8fbc-798a94d01ede |
| By: | Ndoricimpa, Arcade; Nyamweru, Jean Claude; Ndayikeza, Michel Armel |
| Abstract: | Despite the importance of financial inclusion for economic growth and poverty reduction, the formal banking system rarely reaches the rural areas, and when it does, the cost of their services becomes a barrier for low income households and small businesses. The proportion of adult population that owned an account at a financial institution in Burundi was 12.5% in 2016. This is very low com-pared to the sub-Saharan African average of 34%. In addition, a national financial inclusion survey in Burundi in 2016 indicated that the ratio of account holders was five times higher in urban areas than in rural areas. Moreover, the survey indicated some gender and demographic differences in account ownership. The proportion of men owning an account was found to be almost double the women, while the proportion of young people (aged 18-29 years) owning an account was half of those aged 30 years and older. The ratio of account holders was found to vary depending on socioeconomic category; it was found to be 89.5% among state employees, 52.1% for private sector employees, 30.1% for traders and 5.3% for farmers. Contrary to what is observed in many other developing countries, women were found to constitute only 28.3% of microfinance institutions customers. It should be noted that the lack of access to formal financial services means that the poor and small businesses are limited in their ability to save, repay debts, and manage risk responsibly. Its therefore imperative to find innovative models that help extend financial services to the financially excluded and the poor. Its for this reason that digital financial services started in developing countries through mobile phones, in a bid to try bridging the financial inclusion gap. Mobile money technology has been introduced in Burundi as well, but the adoption and use are still low compared to other countries in the region. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:b5046945-9f4a-46df-95b9-db88047c497d |
| By: | Wamalwa, Peter; Tiriongo, Samuel; Mulindi, Hillary |
| Abstract: | East African countries have vibrant telecommunications and banking sectors that have encouraged innovation and digitization of financial services. As a result, the cost of financial services has declined, making them more affordable and accessible to more segments of the population. The relevance of financial services has also improved, thereby contributing to increased uptake of services. Increased access and utilization of relevant financial services contributed to alleviating poverty, growth in incomes and gender parity in wealth. Despite East African countries having a competitive banking sector and strong synergy between telecommunications, banks, and financial technology firms, as well as achieving gains in digital financial inclusion, gender inequalities persist. Despite increasing competition in the banking sector, the gender gap in access to and utilization of financial services remains, particularly among women in rural areas, those engaged in farming or trade, and dependents, who together form the majority in East Africa. Women with lower educational attainment and those living in poverty have significantly less access to digital financial services compared to men. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:a6bc6eca-0402-4c0a-9b73-6020e207e362 |
| By: | Sekumbo, Karia; Ringo, Noela; Manda, Constatine |
| Abstract: | The mobile money industry has conferred numerous benefits to consumers from all segments of income distribution. Given the rapid ascent of the industry, policymakers have grappled with its effective taxation. A key reason underlying this is a poor understanding of the distributional effects. This policy brief investigates a controversial tax that was instituted on mobile money withdrawals in Tanzania in 2021. Almost immediately after its introduction, transaction volumes across mobile money platforms plummeted. Tanzanian policymakers revised the tax multiple times before eventually removing it altogether. Given this U-turn, we investigate how the tax affects different consumer groups. Our findings revealed that salaried workers in urban areas as being more likely to reduce consumption of mobile money services. These results suggest that less wealthy respondents in rural areas with fewer substitutes were forced to contend with this tax while wealthier urban respondents substituted into different financial services. To relieve the rural poor of the onerous burden of this tax, we suggest revising the burden on wealthier segments to ensure that the incidence of taxation leaves them indifferent to contending with the tax as opposed to substituting into different financial services. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:f320982d-cd74-4343-b276-864a33b25103 |
| By: | Tamba, Cox Lwaka; Murithi, Emmaculate Kathomi |
| Abstract: | Kenya is one of the countries in Africa where digital financial access has tremendously grown. Digitalization of the financial sector and the recent increase of Digital Financial Services (DFS) brings new opportunities to help build inclusive economic infrastructure that offers new services to marginalized populations and underserved communities worldwide. DFS can bridge the gender gap by increasing womens financial autonomy and improving their economic participation. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:4c215b39-417d-4477-92d1-2b6e09025cea |
| By: | Osoro, Jared; Bundi, Davis; Kiplangat, Josea |
| Abstract: | The noticeable strides that Kenya has made in financial inclusion underpins the assumption that access automatically translates into usage of digital financial services. The plausibility of this assumption is questionable given that demand for financial services is influenced by behavioural biases. Individual behavioural heterogeneity and self-exclusion attitude account for the differences in financial decision making, with biases creating the wedge that inhibit the usage of financial services even when there are no limitations of access. The implication of such biases is that households have a predisposition of making financial decisions that leads to less optimal welfare outcomes. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:ec5ae1c5-ae9b-44d4-9a17-9244f73756c8 |
| By: | Nasrum, Muhammad |
| Abstract: | A credit card is a symbol of different types of consumer credit. Their use to satisfy consumer needs can trigger impulsive spending, often leading to addiction and even debt bondage. This study follows the activities of a credit card community in Indonesia and includes ethnographic fragments in which credit cards are not used for consumptive purposes but rather as productive business capital. Temporality, as a concept in the anthropological study of debt and credit, is used as a research framework as well as a strategy to comprehensively analyse the credit card algorithm from a cultural perspective, including the characteristics and functions of credit cards that are reflected in the decision-making of community members throughout the life cycle of the credit card, from application to business use, which enables this financial facility to provide benefits and maintain trust. |
| Date: | 2024–10–16 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:mzr8y_v1 |
| By: | Joseph, Samson Taban; Ajongo, Jacqueline Benjamin |
| Abstract: | Among the many problems facing the economy, financial exclusion is one of the major issues facing South Sudan in recent times. About 80% of the countrys adult population lack bank accounts, leaving them financially excluded from accessing and using financial products, services, and information. This is a concerning statistic, as financial inclusion is crucial for economic growth and societal development. This issue was engineered by the countrys high financial illiteracy rate (73%), who are mostly women, and people with special needs. Furthermore, limited financial infrastructure in various regions of the country, such as the insufficient number of bank branches in rural areas and strict Know Your Customer (KYC) regulations, remains a significant concern. Additionally, many adults lack the necessary documents to open bank accounts. As a result, the regulatory framework governing financial inclusion and the role of digital financial services in the country is inadequate. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:c24cc2ac-dcba-4a30-9fb2-81dc80ca9f56 |
| By: | Nasrum, Muhammad |
| Abstract: | This study examines the moral and value-based framing of credit cards as an important tool of Indonesian financial perceptions and practices. By exploring the concept of ‘moral alchemy’, the transformation of cultural values and ethical perspectives on debt and credit is embodied and materialized in credit cards. Using a dynamic mix of multisite ethnography and netnography, I examine how credit card communities in Indonesia are reshaping the use of credit cards from a symbol of risky privileges to tools for financial empowerment. This research combines three areas of interest: Cultural economics, sociocultural perspectives on ethics, and value theory to provide a comprehensive understanding of this phenomenon. My findings show how consumers who are part of the largest community of credit card users in Indonesia actively reshape their moral beliefs to adapt to new financial practices, illustrating the complex interaction between global financial products and local cultural contexts. Such communities represent more than just the adoption of new financial instruments. They also represent a fundamental shift in how consumers and businesses interact with modern financial instruments. This research makes a valuable contribution to the growing literature on financial and economic practices based on socio-cultural perspectives and offers interesting insights into how innovative financial products are adopted and reinterpreted based on moral preferences and values that enable financial returns. |
| Date: | 2024–10–16 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:q9y7d_v1 |
| By: | Shinyekwa, Isaac M. B.; Mpuuga, Dablin; Nattabi, Aida K.; Bulime, Enock W. N |
| Abstract: | Financial inclusion (FI) and specifically access to affordable financial services is very critical in reducing poverty, income inequality as highlighted in Sustainable Development Goals 1, 5 and 10; and accelerating economic growth. FI is therefore important for Uganda like any other country. Women and rural Ugandans are proportionately more included in informal financial groups, whereas men and urban dwellers have more access and usage of formal financial services. The low level of formal FI in rural areas is partly explained by the high cost of providing financial services. Commercial banks are faced with lack of the incentives, information, and sometimes the ability to mitigate the risks of operating beyond urban markets or with low-income clients. Consequently, a significant portion of rural and low-income Ugandans remain financially excluded. In this regard, DFS such as MM emerge as one of the ways to bridge the financial access gap between the financially included and excluded. It is however noted that little is known in Ugandas context concerning the critical enablers as well as inhibitors to access and usage of DFS. The policy brief summarizes findings from the study titled, Leveraging Digital Services and Market Development for Financial Inclusion: The Case of Uganda. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:7ecf9e49-70f2-4a90-927a-afd6067564d6 |
| By: | Jia, Fernando; Zheng, Jade; Li, Florence |
| Abstract: | In the rapidly evolving landscape of GameFi, a fusion of gaming and decentralized finance (DeFi), there exists a critical need to enhance player engagement and economic interaction within gaming ecosystems. Our GameFi ecosystem aims to fundamentally transform this landscape by integrating advanced embodied AI agents into GameFi platforms. These AI agents, developed using cutting-edge large language models (LLMs), such as GPT-4 and Claude AI, are capable of proactive, adaptive, and contextually rich interactions with players. By going beyond traditional scripted responses, these agents become integral participants in the game's narrative and economic systems, directly influencing player strategies and in-game economies. We address the limitations of current GameFi platforms, which often lack immersive AI interactions and mechanisms for community engagement or creator monetization. Through the deep integration of AI agents with blockchain technology, we establish a consensus-driven, decentralized GameFi ecosystem. This ecosystem empowers creators to monetize their contributions and fosters democratic collaboration among players and creators. Furthermore, by embedding DeFi mechanisms into the gaming experience, we enhance economic participation and provide new opportunities for financial interactions within the game. Our approach enhances player immersion and retention and advances the GameFi ecosystem by bridging traditional gaming with Web3 technologies. By integrating sophisticated AI and DeFi elements, we contribute to the development of more engaging, economically robust, and community-centric gaming environments. This project represents a significant advancement in the state-of-the-art in GameFi, offering insights and methodologies that can be applied throughout the gaming industry. |
| Date: | 2025–01–14 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:tn5rx_v1 |
| By: | Nohayla Badrane (ENCGS); Zineb Bamousse |
| Abstract: | In a rapidly evolving landscape marked by continuous change and complex challenges, effective cash management stands as a cornerstone for ensuring business sustainability and driving performance. To address these pressing demands, cash managersare increasingly turning to innovative financing solutions such as venture capital, green finance, crowdfunding, advanced services from Pan-African banks, and blockchain technology. These cutting-edge tools are pivotal in bolstering resilience against market volatility, ecological transitions, and the accelerating pace of technological change. The present article aims to examine how such innovative financial approaches can serve as strategic drivers, enabling businesses to transform challenges into opportunities. The analysis underscores that rethinking cash management through innovation is a critical pathway toboost the performance of Moroccan companies. Therefore, embracing these forward-thinking strategies unlocks new avenues for development empowering them to adapt with agility amidst the uncertainties of a shifting environment. |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2502.14393 |
| By: | Ma, Qingguo; He, Yijin; Tan, Yulin; Cheng, Lu; Wang, Manlin |
| Abstract: | Technological advancements drive the development of payment methods. This review provides a comprehensive examination of the pervasive influence of payment methods on consumer behavior, referred to as payment method effect. We first examine the multifaceted implications of card payments on consumer spending behaviors, post-consumption behaviors, and broader general behaviors, while also analyzing potential moderators including product type and consumer characteristics. Our review unveils the intricate psychological mechanisms underlying the payment method effect, including reduced pain of paying, primed hedonic mindset, biased perceptions of available resources. Looking forward, we underscore several avenues for future research, particularly in exploring the emerging mobile payment effects, designing practical interventions to mitigate dark sides of payment method effects, and investigating cross-cultural heterogeneity in payment method effect. Our review contributes not only to the theoretical advancement of consumer psychology but also to the development of effective strategies for promoting responsible consumer behavior in an increasingly digitized era. |
| Date: | 2024–05–08 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:3fphk_v1 |
| By: | Ndayikeza, Michel Armel; Ndoricimpa, Arcade; Nyamweru, Jean Claude |
| Abstract: | Contrary to the general perception of the authorities interviewed for this study, the latest national survey on mobile money shows that its usage is very low in the country compared to most EAC countries (See Table). Over the period 2019 to 2020, only 11.4% of Burundians reported using their phone to pay, send or receive money. However, the demographics of users, notably gender composition, rural or urban area of residence, age, and education, are similar to those of other EAC countries. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:27c0d032-3fb1-4653-bf70-4ea7725f65aa |
| By: | Mwighusa, Dennis; Diyamett, Bitrina |
| Abstract: | There is now consensus that innovative financial services that are provided in a more equitable and inclusive way are the cornerstone of social and economic development. In this regard, although Tanzania has recorded a significant growth in the level of financial service provision and has reached out to a good number of people in the country, especially through digital means, the country might not benefit from this wide coverage of financial services because it faces a glaring gap in inclusiveness. The reasons for the persistence of such exclusion in spite of policies to address the challenges are not clearly known. This work is an attempt to close this knowledge gap basically towards understanding the factors contributing to both gender and location-related exclusion with the purpose to inform inclusion policies. The findings indicate that the major challenges revolve around inappropriate marketing strategies for the digital financial services for the poor; inappropriate products in terms of price and context fitness; and cost related to product development and service provision on the part of the providers. The existing inclusion policies did not seem to have helped much as they have some serious gaps in their design. |
| Date: | 2024–08–15 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:76690e87-a99e-424a-aa08-7c6c24dfa1aa |
| By: | Nasrum, Muhammad |
| Abstract: | This article presents an anthropological study on credit card use in Indonesia. It focuses on cultural and social knots that mutually influence financial knowledge and experience using the concepts of performativity and temporality in relation to the rapid process of financialization. By focusing on the credit card community in Indonesia, this article explains how they strategize their financial algorithms in the credit card management cycle. This article contributes to anthropological research on the unequal impact of credit card use by exploring the complex relationship between access to financial and ethical justice, variations in cultural contexts, and social hierarchies. The research examines how financial temporality is created through material and institutional practices. The findings presented in this article underscore the importance of considering credit card activities within a broader framework of financialization and complex social dynamics in contemporary Indonesia and other similar contexts. This study contributes to theoretical discussions on the social and cultural elements of financialization by providing an in-depth and specific narrative analysis of credit and debt. |
| Date: | 2024–10–16 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:4wjzv_v1 |
| By: | Ndoricimpa, Arcade; Nyamweru, Jean Claude; Ndayikeza, Michel Armel |
| Abstract: | This study examines the factors determining mobile money adoption and use in Burundi. Heckman selection model is applied on a recent household dataset (Integrated household living conditions survey in Burundi, EICV 2019-2020). The estimation results point to different socio-economic factors that drive the adoption and use of mobile money in Burundi. Age category, education level, being a member of savings and loans associations, and household size are the factors determining the likelihood of mobile money adoption in Burundi, while the probability of mobile money use in Burundi seems to be influenced only by education level, place of residence, and the well-being level. Considering this studys findings, the Government of Burundi should implement policies to reduce the gender gap and duality urban-rural. Efforts should also be put on education investment to reduce illiteracy. The Government of Burundi should also continue implementing policies to raise the well-being of the population and social self-sustained groups, and initiatives to increase incomes of the population especially in rural areas should be encouraged. In addition, concerted effort from different stakeholders, mobile network operators and regulators, is also needed. Making payment systems flexible by increasing mobile agents in remote areas would also most likely lead to increased mobile money adoption. We hope that the findings from this study will inform public authorities to take necessary measures to increase mobile money adoption and use in Burundi. |
| Date: | 2024–08–15 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:680a7bb0-16b9-426a-a24f-19e40903c5ce |
| By: | Lemma, Tesfaye Tadesse; Mlilo, Mthokozisi |
| Abstract: | Women entrepreneurship plays a critical role in achieving sustainable development goals (SDG) of achieving gender equality and poverty reduction by promoting economic growth. The Kenya governments Vision 2030 identifies entrepreneurship as a key tool in eradicating poverty and creating wealth for its people. Policies aimed at improving women's entrepreneurship have had limited success, as women-owned businesses have struggled to survive and succeed compared to male- owned ones. This disparity in performance is attributed to finance-related obstacles. Digital financial services (DFS) and technology can promote financial inclusion and level the playing field for male and female entrepreneurs. According to the latest World Bank Enterprise survey, 53% of Kenyan women-owned businesses reported adopting DFS due to high transaction costs associated with traditional bank services, such as bank fees, time spent conducting banking activities, and the risk associated with cash movement. In Kenya, 36% of households are women-headed and in dual-headed households, women are likely to be the primary caregivers and endure most of the economic and social hardship. DFS can help alleviate social difficulties faced by women entrepreneurs while balancing work and home responsibilities. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:e0a219e2-be70-4582-b156-467cf5e22144 |
| By: | Yuichiro Kamada; Shunya Noda |
| Abstract: | We develop a dynamic model of the Bitcoin market where users set fees themselves and miners decide whether to operate and whom to validate based on those fees. Our analysis reveals how, in equilibrium, users adjust their bids in response to short-term congestion (i.e., the amount of pending transactions), how miners decide when to start operating based on the level of congestion, and how the interplay between these two factors shapes the overall market dynamics. The miners hold off operating when the congestion is mild, which harms social welfare. However, we show that a block reward (a fixed reward paid to miners upon a block production) can mitigate these inefficiencies. We characterize the socially optimal block reward and demonstrate that it is always positive, suggesting that Bitcoin's halving schedule may be suboptimal. |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2502.15505 |
| By: | Akem, Fiennasah Annif |
| Abstract: | Using the FinScope Consumer survey, the study examines the implications of financial inclusion for poverty in Cameroon. Specifically, assessed the impact of financial inclusion on overall welfare and by gender. In order to account for the endogenous selection bias resulting from unobserved confounders and for structural differences between users and non-users of financial services in terms of welfare generating function, we employ the endogenous switching regression. The probit results indicate that men have a higher probability of being financially included compared to women. We further observe that financially included individuals are expected to make welfare gains of about XAF 14, 544 per month. Results equally show that the impact of financial inclusion is higher among men compared to women. These results underscore the need for targeted policies to address gender disparities in access to financial services, implementing policies that promote equal opportunities for men and women in the financial landscape is essential for fostering sustainable economic development and reducing poverty in Cameroon. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:b68fd6e8-123f-4664-80d5-f4f13dd61e2b |
| By: | Juan Pablo Reyes Ochoa (UFC - Université de Franche-Comté - UBFC - Université Bourgogne Franche-Comté [COMUE], Université Paris-Panthéon-Assas) |
| Abstract: | In the search for innovative solutions, organizations are increasingly turning to innovation crowdsourcing platforms to access a large pool of diverse talent. This talent can provide solutions to complex problems that may be outside the organization's traditional scope of expertise. However, a challenge arises: designing mechanisms that foster trust and sustained participation without relying solely on guaranteed contracts, salaries, or rewards. In addition, the question arises as to whether it is more beneficial to integrate this crowd into the business model directly or whether it is preferable to use an intermediary to gain temporary access to this resource. In our research, we explore the design and governance factors that influence the value creation of these platforms. We do so through a systematic literature review, which allows us to identify the boundary resources that have been most frequently addressed in previous studies and discuss the opportunities and implications of their application. |
| Keywords: | crowdsourcing, innovation, digital platforms, governance, design |
| Date: | 2024–06–03 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04952513 |
| By: | Mwighusa, Dennis; Diyamett, Bitrina |
| Abstract: | There are glaring currently inclusion gaps associated with gender, social and economic status, and geographical location in the provision of financial services in Tanzania. For instance, while the World Bank (2018) reports a 9% gap between women and men in access to financial services worldwide, for Tanzania women exclusion stood at 39.3% percent, and that of men was 29.9% (FinScope, 2017). In addition, while 43.3% of the rural population was excluded from formal financial services, only 18.4 percent of urban were excluded (FinScope, 2017). |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:dc0d51b7-51d3-4f34-ab6d-35db41904b07 |
| By: | Shetty, Pavun (Yale University) |
| Abstract: | Blockchain-based games have introduced novel economic models that blend traditional gaming with decentralized ownership and financial incentives, leading to the rapid emergence of the GameFi sector. However, despite their innovative appeal, these games face significant challenges, particularly in terms of market stability, player retention, and the sustainability of token value. This paper explores the evolution of blockchain games and identifies key shortcomings in current tokenomics models using entropy increase theory. We propose two new models—ServerFi, which emphasizes Privatization through Asset Synthesis, and a model focused on Continuous Rewards for High-Retention Players. These models are formalized into mathematical frameworks and validated through group behavior simulation experiments. Our findings indicate that the ServerFi is particularly effective in maintaining player engagement and ensuring the long-term viability of the gaming ecosystem, offering a promising direction for future blockchain game development. |
| Date: | 2024–08–14 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:tsxj2_v1 |
| By: | Gong, Yaping; Khan, Muhammad Aamir; TAM, Kar Yan |
| Abstract: | Fintech, which refers to various technologies (e.g., apps and software) that improve the delivery and/or use of financial activities, is increasingly applied in the financial services industry. However, little is known about the competencies of employees working with fintech (hereafter, ‘fintech employees’). We developed a competency model for fintech employees and then generated and validated instruments for assessing their competencies. In Study 1, we developed a competency model with 13 competencies for fintech employees through interviews and a survey. In Study 2, we followed the standard scale development process (i.e., item generation, content validity assessment, exploratory factor analysis, confirmatory factor analysis, and predictive validity assessment) to develop and validate items for assessing seven selected competencies. In Study 3, we checked the predictive validity of these competencies by testing our hypotheses. In general, these competencies predicted different aspects of fintech employee performance outcomes. Overall, we demonstrated the reliability, validity, and incremental predictive validity of the seven competencies. |
| Date: | 2024–07–30 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:g9e7j_v1 |
| By: | Garang, James Alic |
| Abstract: | This policy brief addresses four key research problems: challenges in opening bank accounts and obtaining IDs, access to financial products and services, and financial literacy. One of the major barriers to accessing financial products, such as loans, is the requirement of a bank account, which in turn necessitates identification (ID). This issue is particularly critical in South Sudan, where only 37, 000 people across the entire country possess IDs, highlighting a significant gap that must be bridged urgently. Due to the widespread financial illiteracy among much of the population, alternative mechanisms for issuing identity cards need to be introduced to include marginalized groups, such as women, people with disabilities, and those in rural areas. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:026070ae-32e3-4f92-86da-80f514cb874d |
| By: | Okot, Nicholas; Shinyekwa, Isaac M. B.; Bulime, Enock N. W.; Luwedde, Justine |
| Abstract: | The fourth-generation technological innovations coupled with Fintech has evolved into global transition to e-money. In Uganda the uptake and usage of e-money services have exponentially grown since the introduction of mobile money services in 2009. This study examines the theoretical foundation of e-money economics and employs time-series econometric approaches on Uganda data for the period 2009Q1-2022Q4 to assess their implication on the stability of the money demand function and transmission of monetary policy. The test for stability following the estimation of the money demand function with autoregressive distributed lag (ARDL) and transmission mechanisms in the vector autoregressive (VAR) model indicate that, e-money distorts the stability of the money demand function in the short-run and is procyclical with monetary policy shock (policy interest rates adjustments). These attributes of e-money are likely to adversely affect the effectiveness of monetary policy transmissions. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:aer:wpaper:509360b0-6f34-4037-8acd-9780301c70cb |
| By: | Winata, Robbie Kurniawan; Soekarno, Subiakto |
| Abstract: | The purpose of this study is to summarize research on digitalization and emphasize how it affects financial performance. Additionally, applicable methodology from recent studies in a variety of domains is shown in this study. The state-of-the-art in digitalization research is described in this review article, which combines technology, finance, marketing, and innovation literature. In recent years, research on digitalization has expanded rapidly in a number of domains, employing both qualitative and quantitative techniques. The elements that affect an organization’s financial performance as a result of its digitalization—such as big data analytics, cloud computing, artificial intelligence, process automation, the Internet of Things (IoT), computer simulations, and online technology—have been the subject of more recent studies. Even if studies on digitalization have been more popular over the past five years, adding new dimensions and investigating qualitative methods remain fascinating areas of study. For academics who are unfamiliar with digitalization, this article provides an overview of how to explore the process. The article enhances the review of the impact of digitization on financial performance. |
| Date: | 2024–08–19 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:my9fk_v1 |
| By: | Amit Kumar; Taoran Ji |
| Abstract: | Cryptocurrencies fluctuate in markets with high price volatility, posing significant challenges for investors. To aid in informed decision-making, systems predicting cryptocurrency market movements have been developed, typically focusing on historical patterns. However, these methods often overlook three critical factors influencing market dynamics: 1) the macro investing environment, reflected in major cryptocurrency fluctuations affecting collaborative investor behaviors; 2) overall market sentiment, heavily influenced by news impacting investor strategies; and 3) technical indicators, offering insights into overbought or oversold conditions, momentum, and market trends, which are crucial for short-term price movements. This paper proposes a dual prediction mechanism that forecasts the next day's closing price by incorporating macroeconomic fluctuations, technical indicators, and individual cryptocurrency price changes. Additionally, a novel refinement mechanism enhances predictions through market sentiment-based rescaling and fusion. Experiments demonstrate that the proposed model achieves state-of-the-art performance, consistently outperforming ten comparison methods. |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2502.19349 |
| By: | Horst Treiblmaier |
| Abstract: | Dee Hock, the founder of Visa, coined the term 'chaordic' to describe simultaneously chaotic and ordered systems. Based on his reasoning, we introduce the Theory of Chaordic Economics to explain how economic systems are transformed by two disruptive technologies: namely Artificial Intelligence and Blockchain. Artificial intelligence can generate novel output through algorithmic yet rather unpredictable processes. Blockchain creates deterministic results without central authorities and relies on elaborated protocols that prescribe how consensus can be reached within a network of peers. The amalgamation of chaos and order produces chaordic economic systems and can yield hitherto unthinkable economic structures. |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2502.16596 |
| By: | World Bank |
| Keywords: | Governance-E-Government Information and Communication Technologies-Digital Divide |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:41983 |
| By: | Lioba Heimbach; Jason Milionis |
| Abstract: | Ethereum has adopted a rollup-centric roadmap to scale by making rollups (layer 2 scaling solutions) the primary method for handling transactions. The first significant step towards this goal was EIP-4844, which introduced blob transactions that are designed to meet the data availability needs of layer 2 protocols. This work constitutes the first rigorous and comprehensive empirical analysis of transaction- and mempool-level data since the institution of blobs on Ethereum on March 13, 2024. We perform a longitudinal study of the early days of the blob fee market analyzing the landscape and the behaviors of its participants. We identify and measure the inefficiencies arising out of suboptimal block packing, showing that at times it has resulted in up to 70% relative fee loss. We hone in and give further insight into two (congested) peak demand periods for blobs. Finally, we document a market design issue relating to subset bidding due to the inflexibility of the transaction structure on packing data as blobs and suggest possible ways to fix it. The latter market structure issue also applies more generally for any discrete objects included within transactions. |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2502.12966 |
| By: | Remi Genet |
| Abstract: | Volume-Weighted Average Price (VWAP) is arguably the most prevalent benchmark for trade execution as it provides an unbiased standard for comparing performance across market participants. However, achieving VWAP is inherently challenging due to its dependence on two dynamic factors, volumes and prices. Traditional approaches typically focus on forecasting the market's volume curve, an assumption that may hold true under steady conditions but becomes suboptimal in more volatile environments or markets such as cryptocurrency where prediction error margins are higher. In this study, I propose a deep learning framework that directly optimizes the VWAP execution objective by bypassing the intermediate step of volume curve prediction. Leveraging automatic differentiation and custom loss functions, my method calibrates order allocation to minimize VWAP slippage, thereby fully addressing the complexities of the execution problem. My results demonstrate that this direct optimization approach consistently achieves lower VWAP slippage compared to conventional methods, even when utilizing a naive linear model presented in arXiv:2410.21448. They validate the observation that strategies optimized for VWAP performance tend to diverge from accurate volume curve predictions and thus underscore the advantage of directly modeling the execution objective. This research contributes a more efficient and robust framework for VWAP execution in volatile markets, illustrating the potential of deep learning in complex financial systems where direct objective optimization is crucial. Although my empirical analysis focuses on cryptocurrency markets, the underlying principles of the framework are readily applicable to other asset classes such as equities. |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2502.13722 |
| By: | International Finance Corporation |
| Keywords: | Finance and Financial Sector Development-Finance and Development Finance and Financial Sector Development-Access to Finance Finance and Financial Sector Development-Microfinance Private Sector Development-Microenterprises Poverty Reduction-Poverty Reduction Strategies |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:42081 |
| By: | CGAP; BIS; IMF; UNSGSA; World Bank |
| Keywords: | Finance and Financial Sector Development-Financial Structures |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:42617 |
| By: | World Bank |
| Keywords: | Information and Communication Technologies-ICT Applications Information and Communication Technologies-Digital Divide Infrastructure Economics and Finance-Infrastructure Regulation |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:42551 |